Tired of Your Current Payroll Solution? 12/1/11 8:00 AM

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December has arrived. In less than a month, January will be here. If you find that you are not thrilled with your current Payroll Solution Provider, be it ADP, PayChecks, your CPA, etc., this is the time to make your move in preparation for that first payroll coming (soon) in January. With that said, and in the interest of full disclosure, let me make it very clear for those of you reading this blog. I (we) at QuickTrainer are not employed by Intuit. We are Independent Consultants. We will always tell you when we like an Intuit Product or Service, and when we are not particularly fond of something offered by Intuit. When it comes to Intuit Payroll, either Assisted Payroll or Enhanced Payroll, we are HUGE fans. Why? Three reasons:

1. Intuit Payroll works and it works well!
2. Intuit's Payroll Solutions are tightly integrated into the QuickBooks Software.
3. Intuit's Payroll will save you money and time.

This blog article will discuss two possible options for you to consider; Assisted Payroll and Enhanced Payroll. By all means, if you have questions regarding anything in this blog posting, or any questions regarding QuickBooks, send us an email at Contact quicktrainer.biz or give us a call at 910-338-0488. We will be glad to help you and steer you in the proper direction.

Intuit's QuickBooks Assisted Payroll

Think of Intuit's Assisted Payroll as the direct competitor to ADP, Paychex or a CPA. It's not that I don't appreciate the services offered by these companies or CPA's. I do appreciate their services they offer. However, based on my first hand experience, they tend to fall short in two key areas: Pricing and Integration. My experience has been Intuit's Assisted Payroll is consistently less expensive than that of ADP, PayChex or a CPA's. What's more, even though ADP and PayChex offer an add-on module to download payroll data and import their data into QuickBooks, this approach still involves multiple additional steps, and most often the detailed data needed for Job Costing purposes is lacking. When you consider pricing AND the tight Integration offered by Intuit, it's hard to go wrong.

Let me provide a real life scenario I recently encountered. A great client of ours has been paying their CPA $280 per month to provide payroll services for ~20 employees. This client runs payroll every two weeks (or 26 payrolls per year). We are in the process of switching this client to Intuit's Assisted Payroll beginning January 1st. Under Intuit, this clients payroll service expense will drop from $280 to $103 per month; a substantial savings of $177/monthly (or $2,124 annually). When this client adds additional employees, the cost, per employee increases by only $1 per employee per payroll. Even more, our client will no longer have to enter a Journal Entry from their CPA to reflect their payroll and the client will have much better reporting capabilities regarding their payroll.

When you sign up for Intuit's Assisted Payroll consider the following:







Want to investigate Assisted Payroll? Ready to make a move to Assisted Payroll? Call QuickTrainer today and we'll be happy to answer your questions or get the process started for you. Just remember, NOW (December) is the time to make this happen.

Next week, I'll post another blog article discussing Intuit's Enhanced Payroll.

 

#ilm

Jim Merritt

 

Your QuickBooks Year End Accounting Check List 11/21/11 8:45 AM

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1. Account Reconciliations – Make sure all bank and credit card accounts are reconciled to the penny as of month-end. Business bank statements typically end on the last day of the year, while some will end on a Friday if the last day of the month falls on a Saturday or Sunday. Credit card statements have varying closing dates. If you find, when reconciling, your opening balance does not match the statements opening balance, STOP and give us a call.
   
   
2. Make a Copy – Once January 2012 rolls around, and you do the December 2011 reconciliations, take the time to make a copy of the front page of each bank and credit card statement. Your CPA will want these copies to verify these accounts have been properly reconciled. Also, if you have made any major capital purchases in 2011, say greater than $1K, make a copy of the sales receipt or invoice for your CPA. This does not include purchases of product for resale.
   
   
3. Want to know one of the best things you can do for yourself, your CPA and anyone whom you desire to review your books? Really pay attention to this advice! It will save you thousands of dollars during the duration of your business. Are you ready? ALWAYS, always, AlWaYs… put a brief and succinct memo in EVERY transaction you record. Checks, bills, credit card charges, deposits, etc., should always contain a brief memo which describes “What is this expense?” and “What is the source of this revenue?”. Do NOT cheat in this area. It will help you when you are looking at a transaction months from now. It helps your CPA (or us at QuickTrainer) when you have a memo to understand what is the purpose of the transaction. It tells us if the transaction has been recorded to the proper G/L account. If not, we can correct the transaction quickly. Assuming the transaction is in the correct G/L account, we can move on with confidence. When accountants encounter transactions we don't understand, we have to ask questions. Questions cost you money. ALWAYS MEMO, MEMO, MEMO.
   
   
4. As you review each General Ledger (G/L) account found on your Balance Sheet and Profit & Loss statement, look for accounts which have, “ – Other” in them. This is an indicator that transactions have been recorded to a parent G/L account. The rule for QuickBooks is, whenever you have sub-accounts (a.k.a., child accounts), you never post ANY transaction to the parent account. The parent account serves as a means to SUM the transactions within the sub-accounts.
   
   
5. W-2/W-3 – If you have employees (personnel in which you withhold federal, state, social security and Medicare taxes on; a.k.a., payroll taxes), and you are responsible for providing them with a W-2, make sure you are prepared to do this sooner rather than later. Do you have a current Form W-4, State Form (NC-4 for North Carolina) and Form I-9 on file for each employee? Do you have all employees' social security numbers recorded in their QuickBooks employee profile? Do you have current addresses for each employee? Are you confident your payroll items are setup properly?
   
   When printing W-2's for your employees and your records, don’t forget to include a W-3. The W-3 is a summary of all W-2’s. It gets filed along with Copy A of your W-2’s and is to be mailed to the Social Security Administration. NOTE: DO NOT FOLD OR TEAR COPY A OF YOUR W-2’S. SAME THING APPLIES TO THE W-3. When you are ready to mail Copy A and the W-3, place them in an 8-1/2 x 11 envelope for mailing.
   
   There is no need to purchase pre-printed forms for your W-2’s/W-3. It is now acceptable (and has been for about 5 years now) to print these forms on plain paper. Don’t forget to sign, title and date your W-3. You need to mail (or personally hand-out) your W-2’s on or before January 31, 2012. Encourage your employees to compare their final 2011 dated paycheck to their W-2. It is important to correct any errors prior to March 1, 2012. The W-3, along with Copy A of your W-2’s need to be mailed on or before February 28, 2012.
   
   
6. 1099’s/1096 – If you have subcontractors who performed work for you in 2011, then you are obligated to provide each subcontractor a 1099 reflecting the compensation they were paid. However, this need only apply to persons or businesses in which you know they are not incorporated, or whom you have any doubt as to if they are actually incorporated.
   
   Much like the W-2's and W-3 discussed in #5 above, when printing 1099's for your subcontractors and your records, don’t forget to include a 1096. The 1096 is a summary of all 1099's. It gets filed along with Copy A of your 1099's and is to be mailed to the Social Security Administration. NOTE: DO NOT FOLD OR TEAR COPY A OF YOUR 1099’S. SAME THING APPLIES TO THE 1096. When you are ready to mail Copy A of the 1099's and the 1096, place them in an 8-1/2 x 11 envelope for mailing.
   
   To help with this decision, and to make sure you have the proper paper work on-hand, you should have (actually, should already have) a signed Form W-9 on file for each subcontractor. The Form W-9 is a form whereby the subcontractor provides you with their proper name, address, tax id number and indicates they are exempt from your withholding any federal taxes. If a subcontractor uses their social security number, then you know they are not incorporated. However, you can be a sole proprietor, yet still have an assigned federal tax id. Again, if you are not certain about the legitimacy of any subcontractor being legally incorporated, err on the side of caution and send them a 1099.
   
   In QuickBooks, your subcontractors must be setup and paid as “Vendors” (NOT Employees). Additionally, you must have each subcontractors address, tax id and the box checked in QuickBooks which reads, “Vendor eligible for a 1099”. Also, you must tell QuickBooks the specific G/L account(s) to look in for 1099 subcontractor vendors. The only accounts which should be considered are those which relate to “Compensation”; not reimbursed expenses.
   
   Finally, if a subcontractor was paid more $600 or more in compensation, then QuickBooks knows to produce a 1099. If a subcontractor was paid less than $600, QuickBooks will not create a 1099. This is how it should be, as $600 is the threshold.
   
   
7. With regards to #5 and #6 above, be sure to make a copy of your employees W-2’s, your W-3, your subcontractors 1099’s and your 1096. Your CPA will want a copy to verify your numbers and for their files.
   
   

   The next several topics deal with a review of your Balance Sheet for the year. You should ensure you are looking at the Balance Sheet on an accrual basis (yes, even if you file your return on a Cash basis).

   
   
8. Accounts Receivable (A/R) – If you create invoices, and any invoices are unpaid, you will see “Accounts Receivable” on your Balance Sheet. Check this balance against the balance on an A/R Aging Report. Do they agree? If not, I will share with you, one of the most common reasons for these reports to not agree has to do with Unapplied Payments (i.e., payments received but not posted to an invoice). Call us for help with this issue.
   
   
9. Undeposited Funds – As of 12/31, there should be no ($0) Undeposited funds on the Balance Sheet. If you do have Undeposited funds showing, it is typically the result of deposits made, but post dated for the next year. If you have checks you have received in late December, but simply have not gone to the bank yet to deposit these funds, and do not plan on going to the bank until early January, you still need to record the deposit as of 12/31. The IRS takes the position of the fact that you had access to these funds in the current year. Just because you did not make it to the bank, does not excuse you for not recognizing the revenue in the year in which the checks were received.
   
   
10. Fixed Assets – If you have made purchases this year, greater than “X” (where “X” is to be determined by your CPA, or otherwise use a guideline of $250) which have a useful life, then these purchases should be found in a Fixed Asset account. This includes, most commonly, purchases such as land, a building, leasehold improvements, furniture, fixtures, equipment, tools, computer hardware, computer software, office equipment and vehicles. You should NOT include product for resale (as this would be found in an Inventory Asset account or a Cost of Goods Sold account) or if you purchased a large amount of a consumable (e.g., Office Depot had a great deal on paper, so you purchased $700 worth. Paper is a consumable).
    
    Finally, unless you record the depreciation of assets yourself on, say, a monthly or quarterly basis, you should not have anything posted to Fixed Asset accounts utilized to reflect depreciation (e.g., a G/L account which reads something like <Less Accum Depreciation of FA>).
    
    
11. Accounts Payable (A/P) – If you enter bills (and you should) and have bills which are still unpaid, you will see “Accounts Payable” on your Balance Sheet. Check this balance against the balance on an A/P Aging Report. Do they agree? If not, much like the A/R notes mentioned prior, I will share with you one of the most common reasons for these reports to not agree has to do with Bill Payment Checks created to pay a bill but then the amount of payment on the check does not match the original bill (because it was later changed for some unknown reason – don’t do this), or the bill was deleted (again, don’t do this) for some unknown reason. Again, call us for help with this issue.
    
    
12. Credit Cards – We have already discussed the reconciling of credit card accounts in #1 above. While looking at your Balance Sheet you should not have ANY credit card accounts reflecting a credit balance unless you really did overpay a credit card total balance.
    
    
13. Sales Tax – This is one of the areas most often abused by people who don’t know better. The bottom line is this: whenever a taxable item is used on an invoice or sales receipt, sales tax is accrued in the Sales Tax Payment liability account. When it’s time to pay your sales tax you should create a Sales Tax Payment check, NOT a regular check. Therefore, drill down into the Sales Tax Payment account. The only transactions you should find are invoices, sales receipts, credit memos, an occasional sales tax adjustment entry and sales tax payment checks. Call us for help with this if you find other transaction types.
    
    
14. Payroll Taxes – Much like sales tax above, this is another area frequently misunderstood. Paychecks create the payroll tax liability. Liability checks are used to pay these liabilities. Any other transactions amongst your payroll tax liability accounts, with the exception of an infrequent payroll liability adjustment is unacceptable and going to cause you issues with proper balances.
    
    Personally, I like to separate the various payroll liabilities into their own separate G/L account. This allows me to look at a glance to see if (a) the company social security and employee social security are in balance with each other; (b) are the company Medicare and employee Medicare in balance with each other; and (c) are there any payroll liability accounts showing a credit balance? If so, do I understand why?
    
    Finally, your CPA will want to have copies of your payroll forms filed throughout the year. These include: 941’s, 940, NC-5, NCU101.
    
    
15. Business Loans – This includes business loans from banks, car loans, mortgage loans, a line of credit, a loan from Uncle Bob or a loan from Shareholder (think S-Corp), Member (LLC) or Owner (Sole Proprietor). Most of these loans provide you with a monthly statement reflecting interest and principal balance. While these type loans can be reconciled monthly, just like a bank or credit card account, it is more typical to conduct an annual reconciliation only utilizing the last statement of the year. Assuming your prior years' opening balance was correct, simply enter your year-ending principle balance, make sure the date reflects the statement date and then continue by clearing all principle payments. Any remaining difference is likely going to be the result of principle and interest payments not being recorded properly. A simple journal entry can be made to correct this difference, whereby (most often) the loan account reflecting the principle balance is credited for the difference and an interest expense account is debited. NOTE: Let me caution you to say the above is a typical or common scenario. There could be other issues causing a discrepancy. Call us for help if you have any doubts about this topic.
    
    When it comes to loans from a shareholder, member or sole proprietor simply make sure the balance outstanding is correct. I too frequently find these loans have a credit balance. This can be where payments have been made for the repayment of a loan, but the actual original principle balance was never recorded.
    
    Finally, if you have made a personal loan of your funds to your business (which is very common), ensure you repay yourself for this loan before taking Profit Distributions or Draws. This way, you avoid any federal and state taxes being paid on these distributions or draws.
    
    
16. Equity – Within the equity section of your Balance Sheet you will most commonly find balances for Capital Stock, Additional Paid in Capital, Profit Distributions or Draws and Retained Earnings. These accounts seldom have transactions posted against them, with the exception of distributions or draws. Capital Stock would only see a change if something happened to the business such as a partner coming in or leaving. It would TRULY be an exception to have ANYTHING posted to Retained Earnings.
    
    
17. This concludes the Balance Sheet review. Next, we move on to a review of your Profit & Loss Statement for the year. You should ensure you are looking at the Profit & Loss Statement on an accrual basis (again, even if you file your return on a Cash basis).
    
    
18. Income – Within the income section of your P&L you will typically find Invoices, Sales Receipts, Credit Memos, and an occasional Payment (perhaps reflecting where a discount was given through the Receive Payment functionality). However, I realize some people bypass invoicing and sales receipts, etc. and simply record Deposits. If this is you, then you would certainly have “Deposits” recorded within your income section. Checks would be more of an exception than the rule. The exception most frequently occurs when the business writes a refund check to a customer or client. There are some other unique scenarios whereby checks might appear, but these are considered beyond the scope of this blog.
    
    
19. COGS (Cost of Goods Sold, a.k.a., Cost of Sales) – Within these accounts you will find products you resell, subcontractors who generate revenue for your business, wages of employees who generate revenue and perhaps Merchant Service Fees along with shipping, postage and materials related to shipping and postage. When reviewing the details of these numbers, if you spot transactions that don’t fall within the above, it likely means the transactions have been recorded to the wrong account and should be moved. In other words, you only wish to have those transactions which are directly associated with a direct expense relationship incurred in order to generate revenue for your business.
    
    
20. Expenses – While reviewing the details within your various expense accounts, you are simply making a determination; do each of these transactions reside in the proper G/L account? Remember #3 regarding memos? These memos are going to go along ways towards helping you make this decision. If you see a check in Office Supplies for $777.77 and the memo says “Laura’s new laptop” you know this check has been recorded to the wrong G/L account. It should be recorded to a Fixed Asset account (e.g., 1840 - Computer H/W). If you find a bill to Progress Energy sitting in the G/L account, “6710 – Books & Publications”, you know this transaction is likely in the wrong account.
    
    
21. Last Year’s Tax Return – Another area often overlooked is ensuring your last year’s QuickBooks financials (in which a tax return has already been filed) ties to the actual tax return. This is sometimes done by your CPA. QuickTrainer provides this service for many of our clients. Why is this important? Your CPA cannot conduct an accurate tax return if this is not done. Again, call us if you have questions regarding this matter.
    
    I will say setting a Closing Date and a Closing Date Password in QuickBooks is a GREAT way to make sure no prior year transactions change once your business data has been submitted for a tax return. This is imperative to your success and saving yourself money.
    

Once you have accomplished the above tasks, you are well under way towards being ready to submit your QuickBooks financial data to your CPA for a tax return. To further assist you with your preparedness, below is a list of things you will want to submit to your CPA for your tax return:

• Most CPA's will want a backup of your QuickBooks data. Work with your CPA to determine if they want an Accountant's Copy backup or a Portable backup. Make sure to let your CPA know the version year of QuickBooks you use, as well as the Admin password for your QuickBooks file. 
• If for some reason your CPA does not use QuickBooks and requires hard-copy reports you should provide them with:
  • Balance Sheet - Cash Basis - as of 12/31/2011
  • Balance Sheet - Accrual Basis - as of 12/31/2011
  • Profit & Loss Statement - Cash Basis - for the year 2011
  • Profit & Loss Statement - Accrual Basis - for the year 2011
  • A/R Aging Summary - as of 12/31/2011
  • A/P Aging Summary - as of 12/31/2011
  • General Ledger Report - for the year 2011
• A copy of the front page of your bank statement(s) ending on December 31st (or very close to this date).
• A copy of the front page of your credit card statement(s) ending on December 31st (or a date closest to this date; it may be 12/20 or it may be 01/07)
• A copy of the December Bank and Credit Card Reconciliation Report
  
• Copies of receipts for purchases made during the prior year for greater than $1K
• Copies of loan balances as of year-end
  
• Copies of your W-2's and W-3
• Copies of your 1099's and 1096
• Copies of your payroll forms filed throughout the year (e.g., 941's, 930, NC-5, NCU101)

While this blog posting certainly does not include every conceivable scenario, I have attempted to layout for you, the reader, some very common areas to review. I hope you find the above information helpful this year and in years to come.

As always, if you have any questions or need some outside help, QuickTrainer is here for you. Call us at 910-338-0488 or send us an email at Contact quicktrainer.biz.

#ilm

Jim Merritt

 

Writing Off Bad Debt 10/5/11 8:55 AM

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A large majority of businesses have experienced an invoice in which they simply cannot collect any or a part of the full invoiced amount. Whether it's due to our current troubled economy resulting in a client's inability to pay, a deadbeat client, or a client who is just not happy with your total invoice or a portion of the total, your business is likely to be faced with writing off an uncollectable invoice(s). This blog article is all about teaching you, as a user of QuickBooks, how to properly write-off or reduce the amount of an invoice. Below are the steps and some pictures of screenshots that will help you to learn this rather simple task and will keep your true collectable A/R accurate.

1. Let's say you have an aging invoice from last year and the amount owed in our example invoice is $1028.14. You have just learned your client has since gone out of business and you deem it is time to just forget about ever collecting these monies. You could delete the invoice, right? Bad idea. Why? It would change the Balance Sheet and Profit & Loss Statement in which your last year's tax return is based on. You don't want to do this! Rather, the correct way to handle this is to write-off this invoice in the current year. If you are required to report financials to a banking institution, a Board of Directors or some other financial accountability entity, you need to give thought to what date you use to write-off the bad debt. The reason is if you have already submitted financial data, you don't want to change what had already been submitted. If the aforementioned is not of any consideration, the date you use is less important so long as the chosen date is in the current year.
2. To write-off the debt in QuickBooks, go to Customers, Receive Payments.
3. Enter your client's name and Tab to the next field. QuickBooks will reveal all Open invoices for this client.
4. Do NOT enter any amount in the amount field. Leave it at $0.
5. Date your transaction based upon your decision from number 1 above.
6. You can skip the Payment Method, Check/Ref and Memo fields.
7. Next, single-click on the invoice you are writing off. This will highlight the invoice. If there is more than one invoice to be written off, we'll address this scenario in a moment.
8. Now, click on the button "Discount & Credits..."
9. From the Discount Tab enter the amount to be written off in the Amount of Discount field. Depending upon your desired outcome (i.e., to write-off the invoice balance in full, or to simply reduce the amount to be paid), will determine the amount you enter in this field
   
10. Select an appropriate account from the Discount Account pull down. In the picture below I have selected the G/L expense type account 7700 · Bad Debt Expense. If I were simply electing to discount an invoice in the interest of goodwill towards a client I would select an income account called 4999 · Discount of Sales. Either way, you may already have similar accounts setup or you may find you need to add these accounts. This blog posting assumes you know how to accomplish the addition of G/L accounts.
11. If you utilize Class Tracking in QuickBooks select a Discount Class. If you don't have the Class Tracking feature turned on this field will not be shown.
12. Click on Done.
13. If there is more than one invoice to be written off single click on the next invoice and repeat steps 8 - 12.
14. Finally, click on Save & New or Save & Close.

The Profit and Loss picture below shows the results of a Bad Debt and Discount of Sales transaction, as described above, having been recorded:



Ok, a little note about Cash Basis accounting versus Accrual Basis accounting and how the above impacts your method of accounting. The only way you can truly write-off a bad debt in a business is if you are on the Accrual Method of accounting. This is because, in an Accrual Basis world, most revenue is recognized when the invoice is created and not when the payment is received against an invoice. Likewise, in an Accrual Basis world most expenses are recognized the moment bill is recorded, not when the bill is paid. In a Cash Basis world revenue is not recognized until the payment is received against the invoice. Additionally, expenses are not recognized until entered bills are actually paid. As a result of this reality you cannot write-off unrecognized revenue (i.e., Cash Basis). Even so, I prefer to still show the Bad Debt write-off and then let the CPA make an adjustment on the tax return when that year's tax return is processed. When all is said and done I still have information about what was uncollectable and an Adjusting Journal Entry can be made to remove the disallowed expense (again, Cash Basis) as of 12/31 (assuming you operate on a calendar year).

Like what you see? Have questions regarding this blog posting or perhaps you have questions about how to do something else in QuickBooks? Call QuickTrainer, Inc. at 910-338-0488 or leave us a comment on this page and let us know.

Jim Merritt

 

One Vendor - Two Unique Account Numbers 8/17/11 12:14 PM

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It's a common scenario; you have two different/unique account numbers with the same vendor. If you record two bills for each account to make a payment on each of the accounts, but you use the same vendor name in QuickBooks to pay the two bills, QuickBooks will combine the two bills into one (1) Bill Payment Check. Likely not the result you are looking for.

Sure, you could select one of the bills for payment, pay this bill, and then go back and select the other bill for payment, but there's a better way that will save you time and make this process easier. As an added bonus, you can learn a little trick about auto populating your account numbers on Bill Payment Checks.

Check out the link to this QuickBooks Tip & Trick YouTube video and see if it helps you. QuickBooks guru and Advanced Certified QuickBooks ProAdvisor, Jim Merritt of QuickTrainer, Inc. shows you how to easily handle this situation.

http://youtu.be/wW1rS5nYZaE

Like what you see? Have questions regarding this YouTube video or perhaps you have questions about how to do something else in QuickBooks? Leave us a comment on this page and let us know.

Jim Merritt

 

QuickBooks and Multiple Currencies 8/2/11 12:15 PM

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I was recently working with a client who uses the Multiple Currency functionality available in QuickBooks. There was some confusion with the client with regards to exactly how multi-currency works. In the interest of full disclosure, I had a few questions myself regarding how multi-currency works. This client is my only client who uses this feature in QuickBooks, so I had not had a lot of practice. So, I did what any good consultant would do: I admitted I was not sure and I went back to the office, did some reading within QuickBooks, explored some Intuit Community Boards and did some testing of various scenarios. I now understand Multiple Currencies within QuickBooks.

As a result, I have created a YouTube video within the YouTube QuickTrainer Channel explaining how Multiple Currency works within the QuickBooks Software and attempts to resolve some of the confusion which seems common with this functionality. You can view this video by clicking on the following link: QuickBooks and Multiple Currency.

Jim Merritt

 

Opening Balance Off? 6/30/11 1:25 PM

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You go to reconcile last month's bank or credit card statement only to find the opening balance does not match the current statement. What do you do? It use to be this was a more difficult issue to resolve. However, in the last several years Intuit has made resolving this issue much easier via the Locate Discrepancies functionality (sorry Mac users; this functionality is still not present for you).

While this functionality allows you to do several things, the one this article discusses is the Discrepancy Report. This very useful report, in an ideal scenario, will be blank. However, if your opening balance is off, then this report will show you what has changed since the last reconciliation. The following image shows a blank report (i.e., a report without any issues):

The image below shows this same report; but now with issues:

Two issues are seen on this report. The deposit is an easy fix. Notice the "Effect of Change" is -0.27. You can simply double click on the deposit and change the deposit amount back to $10,456.27. Granted, there are several scenarios where you might have to touch several transactions to put this deposit back to its original amount, but that is beyond the scope of this blog article.

So, you may ask, "Why would you want to change the deposit back?" The better question is likely, "why did a previously reconciled transaction amount ever change?" If a transaction cleared the bank at one amount, why would you ever change this amount? The answer is, "you shouldn't". But I see this all too frequently. It does happen typically because an end user, who did not understand the consequences of their actions, was trying to resolve some other issue.

Now, the Check in the above report, which in looking at the "Effect of Change", has been Deleted, gets a little more trickier. Again, the most likely scenario would insinuate this check needs to be reentered. Why? Because it was previously reconciled meaning it cleared the bank at some point in the past. Therefore, it needs to be put back in and then the account needs to be re-reconciled.

If the deleted transaction(s) were deleted in the prior month; or, there are minimal transactions going back to the month in which the original check was deleted, the cleanest manner in which to address the re-reconciliation would be to click on Undo Last Reconciliation button found in the Locate Discrepancies screen. This approach, once the transaction(s) are re-entered and the account is re-reconciled with result in a Discrepancy Report that is blank. On the other hand, if the thought of having to re-reconcile is overwhelming to you, there is another approach.

First re-enter the effected transaction(s), being careful to assign the original transaction dates. Next, begin the re-reconciliation process by entering the BEGINNING BALANCE found on the current bank or credit card statement in which you first discovered this issue. You read this correct: Enter the BEGINNING BALANCE on the statement. NOTE: You will be entering this amount in the ENDING BALANCE field of the QuickBooks reconciliation screen. Also, change the Statement Date, Service Charge Date and Interest Earned Date to the last reconciled date. Click Continue. Now, the only transaction(s) you will be clearing are the one(s) which originally appeared on the Discrepancy Report (in other words, the transaction(s) you re-entered earlier. This should bring your Difference amount to $0. Click Reconcile Now. Your reconciliation issues should now be resolved and you can move forward with your current reconciliation.

It's worth noting, in the above process, because you did not Undo Last Reconciliation, the Discrepancy Report will continue to show transactions deleted. This is fine as long as you understand why and note that the transactions shown have been dealt with using the aforementioned process. Personally, I am a big fan of Undo Last Reconciliation but I do realize for some users, this could be a very painful process.

If you have any questions about this post, simply post a comment below. If you have questions or issues with your QuickBooks data, call QuickTrainer at 910-338-0488. We are QuickBooks Guru's for a reason; we love helping people.

For more information about QuickTrainer, visit our website at www.quicktrainer.biz.

#ILM

Jim Merritt

 

"Find" It 6/23/11 8:35 AM

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QuickBooks offers an often overlooked, yet powerful feature which you need to know about, “Find”. If you are looking for a transaction and you know anything about the transaction, use Find to...yep, that's right…find it.

First, let me explain how to access Find. You can click on "Edit", "Find". Alternatively, you can press the "Ctrl" key and while keeping it pressed, also press the letter "F". This is known as "Ctrl+F" (NOTE: Control or Ctrl keys are another blog subject for another day). Finally, on many screens within QuickBooks, you will notice the word "Find" with a magnifying glass next to the word.

Within QuickBooks there are two find tabs: Simple Find and Advanced Find.

The Simple Find is transaction specific. Say, for example, you are on the Invoice screen and you click on Find, QuickBooks assumes you want to find an invoice. From this screen, you can select a customer, date (or date range), invoice number or amount. It's worth understanding you can enter one or search on many of these fields at once. Perhaps you want to see all invoices for customer ABC, where the date is 01/01/2011 thru 05/31/2011 and the amount is $250. Simply enter these criteria on the find screen.

Furthermore, if your Find criteria only results in one "hit" you are taken to the specific transaction. If your Find criteria results in numerous matching transactions for your criteria, then you are presented with a list of the matching transactions.

If you are not on a specific transaction screen, and you press "Ctrl+F", a slightly different Find window will appear. Here you will see two tabs; Simple and Advanced (as mentioned earlier). Again, the Simple tab is transaction specific. It's a little different from starting a "Find" on a transaction screen in that it will allow you to specify a transaction type. Other than this, it operates the same.

The Advanced Find is simply a more powerful Find feature. Let's say I want to find all deposits for customer ABC which are equal to or greater than $500 and have a deposit date between 01/15/2011 and 05/15/2011. This is easily accomplished with the Advanced Find feature.

Personally, I have used Advanced Find in countless ways to help me locate transactions during a data cleanup engagement. This simple feature has saved me countless hours which equates to numerous dollars we save our clients.

Another illustration regarding how this feature can help... I once showed a client how they could batch print invoices to their clients. The problem was, there were a plethora of invoices in a "To be printed" status from years ago. The client had no interest in printing these old invoices; only invoices marked "To be printed" going forward. Therefore, I needed a quick way to "unmark" these older invoices so they were no longer clouding the real picture. Using the Advanced Find, I specified the following criteria:

Date = 01/01/1990 thru 01/31/2009
Transaction Type = Invoice
Detail Level = Summary Only
Printed Status = To be printed

This revealed 2700+ invoices. I then used another software tool to quickly write a macro to edit each invoice and remove the To be printed status. It worked like a charm and was certainly much easier than sitting there, opening each invoice, removing this check mark and saving the invoice.

If you are new to the "Find" feature within QuickBooks jump in and give it a try. Think about what you know about a transaction or transactions you are looking for and get use to combining multiple find criteria to shorten your list of matches. You're going to love this feature.

If you have any questions about this post, simply post a comment below. If you have questions or issues with your QuickBooks data, call QuickTrainer at 910-338-0488. We are QuickBooks Guru's for a reason; we love helping people.

For more information about QuickTrainer, visit our website at www.quicktrainer.biz.

#ILM

Jim Merritt

 

QuickBooks Invoices (To Be Printed) 6/10/11 8:14 AM

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A client recently asked me how she could easily get rid of a list of old invoices which were marked "To Be Printed". She had over 2,000 invoices in this status. These particular invoices appear when she goes to print a batch of current invoices (to see this in QuickBooks, click on File, Print Forms, Invoices). This means she has to click on "Select None" and then select the current invoices she really does want to print. This client typically has 100-200 invoices twice a month that she really wants to print. While doing the above is not a huge issue for her, the issue is nonetheless annoying (I know it would annoy me).

Now, while you could actually do an Advanced Find, setting the filter "Printed Status" and set this filter to "To Be Printed", this would certainly result in locating the offending invoices. But this would mean selecting each invoice one at a time, deselecting the "To Be Printed" check mark and then saving the invoice. If you only had a handful of invoices to deal with this would work just fine. But what if you have a 100 or, in the scenario above, more than 2,000 that you want to deal with? There must be an easier way, right?

Indeed there is an easier way...IF you have the Microsoft XPS Document Writer installed on your computer. Who has this installed? If you have Microsoft Office (or just about anything Microsoft related) chances are good you have this print driver installed. The Microsoft XPS Document Writer is simply a print driver which appears in your list of available printers when you go to print a document.

To use this driver AND to get rid of any old documents within QuickBooks that are in a "To Be Printed" status do the following:

• Within QuickBooks go to File, Print Forms and select the form type you want to print. In the scenario above, the forms were invoices.
• A list of the To Be Printed forms will appear. Select "OK" indicating you want to send them to the printer.
  
• After a few seconds a print dialog box will appear. Within the "Printer name" drop down box, select the Microsoft XPS Document Writer as the printer you want to use.
• Select "Print". You will next be greeted with a screen prompting you to give your print job a name. Give it any name you desire. Also, make a mental or physical note of where the file you are naming will be stored on your computer. This way you can easily find and delete the file created by the Microsoft XPS Document Writer afterwards. I typically save the file to my Desktop.
  
• Click "Save". Wait a few moments and you will be greeted with a "Print Invoices - Confirmation" screen. Click "OK".
• You have just cleared the subject forms. Find the file created by the Microsoft XPS Document Writer and delete it. As an aside, you can actually open the file created by the Microsoft XPS Document Writer and view the forms generated.
  

If you have any questions about this post, or if you have questions or issues with your QuickBooks data, call QuickTrainer at 910-338-0488. We are QuickBooks Guru's for a reason. We love helping people like you.

For more information about QuickTrainer, visit our website at www.quicktrainer.biz.

#ILM

Jim Merritt

 

Intuit Merchant Services & Payroll 5/11/11 8:14 AM

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It simply makes sense! That is Intuit's Payment Solutions (aka Merchant Services) and Payroll make sense. Why? Allow me to elaborate...

Seeing how just about everything we do at QuickTrainer involves QuickBooks (QuickBooks Financials or QuickBooks Point of Sale), this blog article is primarily targeted to users of QuickBooks. However, if you are not (yet) a user of QuickBooks, Intuit Payment Solutions has a solution for you as well.

Let me begin with Intuit Payment Solutions (IPS) - What is it? It's the service which allows your business to accept credit cards for products and services you sell.

There is no doubt payment solutions or merchant services is a highly (and I do mean highly) competitive market. I can vividly recall, when we first opened our doors in September of 2006, the number of calls we received from vendors selling their credit card services was staggering. It was annoying to say the least.

So why choose Intuit Payment Solutions over everyone else? The answer is really quiet simple...

• IPS is integrated (tightly integrated) into the QuickBooks software. This means when you receive payments or process sales receipts against a credit card, all processing takes place within the software right then in real time. If you use another Merchant Service provider, you must still create a sales receipt or receive payment against an invoice and also process the credit card separately. It's a pain!
• No more end-of-day batching of credit card transactions. All batching takes place automatically in the background on a daily basis.
  
• IPS is very competitive with their rates; especially when you figure the above time-savings into the equation.

How about Intuit Payroll (IP) - What is it? It's the service which allows you to process your company's payroll within QuickBooks. Primarily, you either purchase an annual subscription if you intend on generating your own paychecks, filing your own tax forms and making your own tax liability payments. This subscription is referred to as Intuit Enhanced Payroll. NOTE: Intuit offers a basic payroll subscription. However, this option does not allow for you to automatically complete the required state forms. The price for Enhanced is well worth the price.

For the person who wants to generate their own paychecks, or have a third party generate the paychecks, as well as have a third party file the required tax forms and make the tax liability payments on your behalf, you cannot beat Intuit Assisted Payroll. This service offering is what truly competes with the various payroll service providers (i.e., PayChex, ADP, etc.). In my practice, I have witnessed time and time again two of the well known payroll providers lure customers to their service by offering low-ball fees only to change their fee structures within 6 months or less. In my experience with Intuit, they are very upfront with their fees so that you can easily understand what their service offering will truly cost you over time.

A word of caution...you do NOT want to ever get into a situation where you do not pay the proper payroll tax amounts and pay the payroll taxes on time. The penalties and interest can sink a business. If there is ANY doubt that you or an authorized person can and will see to it that these payroll taxes and forms are paid on time, then by all means, do yourself a favor and opt for Intuit Assisted Payroll.

So why choose Intuit Payroll? Once again, the answer is really quiet simple...

• IP is integrated (again, tightly integrated) into the QuickBooks software. It works and it works very well!
• IP tracks all wages, withholding, payroll tax liabilities and payroll tax liability payments within the software. Other companies require you either (a) manually enter your payroll or (b) use their interface, which in my experience is always lacking some feature or function you want. Even if there was a perfect payroll interface to QuickBooks from a third party payroll provider, it's another step required for the processing of payroll.
• IP is, once again, very competitive with their payroll processing. Intuit does payroll very well!

The bottom line to IPS and/or IP is this...if you want to simplify your credit card processing and/or payroll we'll make it simple for you to take a no-obligation look and see what Intuit can do for you. Simply call QuickTrainer at 910-338-0488 or send us an email at (Contact quicktrainer.biz) with your contact information and we'll take it from there. It's that simple...really!

For more information about QuickTrainer, visit our website at www.quicktrainer.biz.

#ilm

Jim Merritt

 

Credit Card Tracking in QuickBooks 12/20/10 7:14 AM

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At QuickTrainer, we love sharing QuickBooks Tips & Tricks with people who use QuickBooks. This video represents one of many to come videos containing such educational tips and tricks related the QuickBooks. This video teaches you how to properly record credit card charges, pay a credit card bill and reconcile a credit card account in QuickBooks.

http://www.youtube.com/watch?v=K2KtWJBUuSQ

If you find this video helpful, have any questions about this video, simply leave a comment below and we will respond. If you have questions or issues with your QuickBooks data, give QuickTrainer a call at 910-338-0488. We are QuickBooks guru's for a reason; we love helping people.

For more information about QuickTrainer, visit our website at www.quicktrainer.biz.

#ILM

Jim Merritt

 

Year End Tips for your QuickBooks Financials 12/8/10 11:28 AM

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1. Account Reconciliations – Make sure all bank and credit card accounts are reconciled to the penny as of month-end. Business bank statements typically end on the last day of the year. Credit card statements have varying closing dates. If you find, when reconciling, that your opening balance does not match the statements opening balance, STOP and give us a call.
   
   
2. Make a Copy – Once January 2011 rolls around, and you do the December 2010 reconciliations, take the time to make a copy of the front page of each bank and credit card statement. Your CPA will want these copies to verify these accounts have been properly reconciled. Also, if you have made any major capital purchases in 2010, say greater than $1K, make a copy of the sales receipt or invoice for your CPA. This does not include purchases of product for resale.
   
   
3. Want to know one of the best things you can do for yourself, your CPA and anyone whom you desire to review your books? Really pay attention to this advice! It will save you thousands of dollars during the duration of your business. Are you ready? ALWAYS, always, AlWaYs… put a brief and succinct memo in EVERY transaction you record. Checks, bills, credit card charges, deposits, etc., should always contain a brief memo which describes, “What is this expense?”, “What is the source of this revenue?”. Do NOT cheat in this area. It will help you when you are looking at a transaction months from now. It helps your CPA (or us at QuickTrainer) when you have a memo, to understand what is the purpose of the transaction. It tells us if the transaction has been recorded to the proper G/L account. If not, we can correct the transaction quickly. Assuming the transaction is in the correct G/L account, we can move on with confidence. When accountants encounter transactions we don't understand, we have to ask questions. Questions cost you money. ALWAYS MEMO, MEMO, MEMO.
   
   
4. As you review each General Ledger (G/L) account found on your Balance Sheet and Profit & Loss statement, look for accounts which have, “ – Other” in them. This is a typical indicator that transactions have been recorded to a parent G/L account. The rule for QuickBooks is, whenever you have sub-accounts (a.k.a., child accounts), you never post ANY transaction to the parent account. The parent account serves as a means to SUM the transactions within the sub-accounts.
   
   
5. W-2/W-3 – If you have employees (personnel in which you withhold federal, state, social security and Medicare taxes on; a.k.a., payroll taxes), and you are responsible for providing them with a W-2, make sure you are prepared to do this sooner rather than later. Do you have a current Form W-4, NC-4 and I-9 on file for each employee? Do you have all employees social security numbers recorded in their QuickBooks employee profile? Do you have current addresses for each employee? Are you confident your payroll items are setup properly?
   
   When printing W-2's for your employees and your records, don’t forget to include a W-3. The W-3 is a summary of all W-2’s. It gets filed along with Copy A of your W-2’s and is to be mailed to the Social Security Administration. NOTE: DO NOT FOLD OR TEAR COPY A OF YOUR W-2’S. SAME THING APPLIES TO THE W-3. When you are ready to send Copy A and the W-3, place them in an 8-1/2 x 11 envelope.
   
   There is no need to purchase your W-2’s/W-3. It is now acceptable (and has been for about 4 years now) to print these forms on plain paper. Don’t forget to sign, title and date your W-3. You need to mail (or personally hand-out) your W-2’s on or before January 31, 2011. Encourage your employees to compare their final 2010 dated paycheck to their W-2. It is important to correct any errors prior to March 1, 2011. The W-3, along with Copy A of your W-2’s need to be mailed on or before February 28, 2011.
   
   
6. 1099’s/1096 – If you have subcontractors who performed work for you in 2010, then you are obligated to provide each subcontractor a 1099 reflecting the compensation they were paid. However, this need only apply to persons or businesses in which you know they are not incorporated, or whom you have any doubt as to if they are actually incorporated.
   
   Much like the W-2's and W-3 discussed in #5 above, when printing 1099's for your subcontractors and your records, don’t forget to include a 1096. The 1096 is a summary of all 1099's. It gets filed along with Copy A of your 1099's and is to be mailed to the Social Security Administration. NOTE: DO NOT FOLD OR TEAR COPY A OF YOUR 1099’S. SAME THING APPLIES TO THE 1096. When you are ready to send Copy A of the 1099's and the 1096, place them in an 8-1/2 x 11 envelope.
   
   To help with this decision, and to make sure you have the proper paper work on-hand, you should have (actually, should already have) a signed Form W-9 on file for each subcontractor. The Form W-9 is a form whereby the subcontractor provides you with their proper name, address, tax id number and indicates they are exempt from your withholding any federal taxes. If a subcontractor uses their social security number, then you know they are not incorporated. However, you can be a sole proprietor, yet still have an assigned federal tax id. Again, if you are not certain about the legitimacy of any subcontractor being legally incorporated, err on the side of caution and send them a 1099.
   
   In QuickBooks, your subcontractors must be setup and paid as “Vendors” (NOT Employees). Additionally, you must have each subcontractors address, tax id and the box checked in QuickBooks which reads, “Vendor eligible for a 1099”. Also, you must tell QuickBooks the specific G/L accounts to look in for 1099 subcontractor vendors. The only accounts which should be considered are those which relate to “Compensation”; not reimbursed expenses.
   
   Finally, if a subcontractor was paid more $600 or more in compensation, then QuickBooks knows to produce a 1099. If a subcontractor was paid less than $600, QuickBooks will not create a 1099. This is how it should be, as $600 is the threshold.
   
   
7. With regards to #5 and #6 above, be sure to make a copy of your employees W-2’s, your W-3, your subcontractors 1099’s and your 1096. Your CPA will want a copy to verify your numbers and for their files.
   
   
8. The next several topics deal with a review of your Balance Sheet for the year. You should ensure you are looking at the Balance Sheet on an accrual basis (yes, even if you file your return on a Cash basis).
   
   
9. Accounts Receivable (A/R) – If you create invoices, and any invoices are unpaid, you will see “Accounts Receivable” on your Balance Sheet. Check this balance against the balance on an A/R Aging Report. Do they agree? If not, I will share with you, one of the most common reasons for these reports to not agree has to do with Unapplied Payments (i.e., payments received but not posted to an invoice). Call us for help with this issue.
   
   
10. Undeposited Funds – As of 12/31, there should be no ($0) Undeposited funds on the Balance Sheet. If you do have Undeposited funds showing, it is typically the result of deposits made, but post dated for the next year. If you have checks you have received in late December, but simply have not gone to the bank yet to deposit these funds, and do not plan on going to the bank until early January, you still need to record the deposit as of 12/31. The IRS takes the position of the fact that you had access to these funds in the current year. Just because you did not make it to the bank, does not excuse one for not recognizing the revenue in the year in which the checks were received.
    
    
11. Fixed Assets – If you have made purchases this year, greater than “X” (where “X” is to be determined by your CPA, or otherwise use a guideline of $250) which have a durable life, then these purchases should be found in a Fixed Asset account. This includes, most commonly, purchases such as land, building, leasehold improvements, furniture, fixtures, equipment or tools, computer hardware, computer software, office equipment and vehicles. You should NOT include product for resale (as this would be found in an Inventory Asset account or a Cost of Goods Sold account), or if you purchased a large amount of a consumable (e.g., Office Depot had a great deal on paper, so you purchased $700 worth. Paper is a consumable).
    
    Finally, unless you record the depreciation of assets yourself on, say, a monthly or quarterly basis, you should not have anything posted to Fixed Asset accounts utilized to reflect depreciation (e.g., a G/L account which reads something like <Less Accum Depreciation of FA>)
    
    
12. Accounts Payable (A/P) – If you enter bills (and you should) and have bills which are still unpaid, you will see “Accounts Payable” on your Balance Sheet. Check this balance against the balance on an A/P Aging Report. Do they agree? If not, much like the A/R notes mentioned prior, I will share with you, one of the most common reasons for these reports to not agree has to do with Bill Payment Checks created to pay a bill but then the amount of payment on the check does not match the original bill (because it was later changed for some unknown reason – don’t do this), or the bill was deleted (again, don’t do this) for some unknown reason. Again, call us for help with this issue.
    
    
13. Credit Cards – We have already discussed the reconciling of credit card accounts in #1 above. While looking at your Balance Sheet, you should not have ANY credit card accounts reflecting a credit balance, unless you really did overpay a credit card total balance.
    
    
14. Sales Tax – This is one of the areas most often abused by people who don’t know better. The bottom line is this… whenever a taxable item is used on an invoice or sales receipt, sales tax is accrued in the Sales Tax Payment liability account. When it’s time to pay your sales tax, you should create a Sales Tax Payment check, NOT a regular check. Therefore, drill down into the Sales Tax Payment account. The only transactions you should find are invoices, sales receipts, credit memos, an occasional sales tax adjustment entry and sales tax payment checks. Call us for help with this if you find other transaction types.
    
    
15. Payroll Taxes – Much like sales tax above, this is another area frequently misunderstood. Paychecks create the payroll tax liability. Liability checks are used to pay these liabilities. Any other transactions amongst your payroll tax liability accounts, with the exception of an infrequent payroll liability adjustment is unacceptable and going to cause you issues with proper balances.
    
    Personally, I like to separate the various payroll liabilities into their own separate G/L account. This allows me to look at a glance to see if; (a) are the company social security and employee social security in balance with each other? (b) are the company Medicare and employee Medicare in balance with each other? (c) are there any payroll liability accounts showing a credit balance? If so, do I understand why?
    
    Finally, your CPA will want to have copies of your payroll forms filed throughout the year. These include: 941’s, 940, NC-5, NCU101.
    
    
16. Business Loans – This includes business loans from banks, car loans, mortgage loans, a line of credit, a loan from Uncle Bob or a loan from Shareholder (think S-Corp), Member (LLC) or Owner (Sole Proprietor). Most of these loans provide you with a monthly statement reflecting interest and principal balance. While these type loans can be reconciled monthly, just like a bank or credit card account, it is more typical to conduct an annual reconciliation only utilizing the last statement of the year. Assuming your prior years opening balance was correct, simply enter your year-ending principle balance, make sure the date reflects the statement date and then continue by clearing all principle payments. Any remaining difference is likely going to be the result of principle and interest payments not being recorded properly. A simple journal entry can be made to correct this difference, whereby (most often) the loan account reflecting the principle balance is credited for the difference and an interest expense account is debited. NOTE: Let me caution you to say the above is a typical or common scenario. There could be other issues causing a discrepancy. Call us for help if you have any doubts about this topic.
    
    When it comes to loans from a shareholder, member or sole proprietor, simply make sure the balance outstanding is correct. I too frequently find these loans have a credit balance. This can be where payments have been made for the repayment of a loan, but the actual original principle balance was never recorded.
    
    Finally, if you have made a personal loan of your funds to your business (which is very common), ensure you repay yourself for this loan before taking Profit Distributions or Draws. This way, you avoid any federal and state taxes being paid on these distributions or draws.
    
    
17. Equity – Within the equity section of your Balance Sheet, you will most commonly find balances for Capital Stock, Additional Paid in Capital, Profit Distributions or Draws and Retained Earnings. These accounts seldom have transactions posted against them, with the exception of distributions or draws. Capital Stock would only see a change if something happened to the business such as a partner coming in or leaving. It would TRULY be an exception to have ANYTHING posted to Retained Earnings.
    
    
18. This concludes the Balance Sheet review. Next, we move on to a review of your Profit & Loss Statement for the year. You should ensure you are looking at the Balance Sheet on an accrual basis (again, even if you file your return on a Cash basis).
    
    
19. Income – Within the income section of your P&L, you will typically find Invoices, Sales Receipts, Credit Memos, and an occasional Payment (perhaps reflecting where a discount was given through the Receive Payment functionality). However, I realize some people bypass invoicing and sales receipts, etc. and simply record Deposits. If this is you, then you would certainly have “Deposits” recorded within your income section. Checks would be more of an exception than the rule. The exception most frequently occurs when the business writes a refund check to a customer or client. There are some other unique scenarios whereby checks might appear, but these are considered beyond the scope of this blog.
    
    
20. COGS (Cost of Goods Sold, a.k.a., Cost of Sales) – Within these accounts you will find products you resell, subcontractors who generate revenue for your business, wages of employees who generate revenue and perhaps Merchant Service Fees along with shipping, postage and materials related to shipping and postage. When reviewing the details of these numbers, if you spot transactions that don’t fall within the above, it likely means the transactions has been recorded to the wrong account and should be moved. In other words, you only wish to have those transactions which are directly associated with a direct expense relationship incurred in order to generate revenue for your business.
    
    
21. Expenses – While reviewing the details within your various expense accounts, you are simply making a determination; does each of these transactions reside in the proper G/L account? Remember #3 regarding memos? These memos are going to go along ways towards helping you make this decision. If you see a check in Office Supplies for $777.77 and the memo says, “Laura’s new laptop”, you know this check has been recorded to the wrong G/L account. It should be recorded to a Fixed Asset account (e.g., 1840 - Computer H/W). If you find a bill to Progress Energy sitting in the G/L account, “6710 – Books & Publications” you know this transaction is likely in the wrong account.
    
    
22. Last Year’s Tax Return – Another area often overlooked is ensuring your last year’s QuickBooks financials (in which a tax return has already been filed) ties to the actual tax return. This is sometimes done by your CPA. QuickTrainer provides this service for many of our clients. Why is this important? Your CPA cannot conduct an accurate tax return if this is not done. Again, call us if you have questions regarding this matter.
    
    I will say setting a Closing Date and a Closing Date Password in QuickBooks is a GREAT way to make sure no prior year transactions change once your business data has been submitted for a tax return. This is imperative to your success and saving yourself money.
    

Once you have accomplished the above tasks, you are well under way towards being ready to submit your QuickBooks financial data to your CPA for a tax return. To further assist you with your preparedness, below is a list of things you will want to submit to your CPA for your tax return:

• Most CPA's will want a backup of your QuickBooks data. Work with your CPA to determine if they want an Accountant's Copy backup or a Portable backup. Make sure to let your CPA know the version year of QuickBooks you use, as well as the Admin password for your QuickBooks file. 
• If for some reason your CPA does not use QuickBooks and requires hard-copy reports you should provide them with:
• Balance Sheet - Cash Basis - as of 12/31/2010
• Balance Sheet - Accrual Basis - as of 12/31/2010
• Profit & Loss Statement - Cash Basis - for the year 2010
• Profit & Loss Statement - Accrual Basis - for the year 2010
• A/R Aging Summary - as of 12/31/2010
• A/P Aging Summary - as of 12/31/2010
• General Ledger Report - for the year 2010
• A copy of the front page of your bank statement(s) ending on December 31st (or very close to this date).
• A copy of the front page of your credit card statement(s) ending on December 31st (or a date closest to this date; it may be 12/20 or it may be 01/07).
• A copy of the December Bank and Credit Card Reconciliation Report
  
• Copies of receipts for purchases made during the prior year for greater than $1K
• Copies of loan balances as of year-end
  
• Copies of your W-2's and W-3
• Copies of your 1099's and 1096
• Copies of your payroll forms filed throughout the year (e.g., 941's, 930, NC-5, NCU101)

While this blog posting certainly does not include every conceivable scenario, I have attempted to layout for you, the reader, some very common areas to review. I hope you find the above information helpful this year and in years to come.

#ilm

Jim Merritt

 

Having Trouble Opening QuickBooks - Error 6094,0 4/26/10 2:13 PM

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We are getting phone calls and emails today from clients that can't get their QuickBooks file to open. It is giving an error 6094. If you are getting this error, simply click on the below link and follow the instructions.

Instructions to Fix Error 6094,0.

If you're still having trouble, give us a call (910-338-0488 x3).


Denise

#ilm

Denise Merritt

 

Create a QuickBooks Invoice with Remittance Section 2/20/10 2:55 PM

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Kevin, a QuickBooks peer, posted on LinkedIn an issue he was facing within one of the QuickBooks groups. Here is what he asked...

"Special Customized Invoice - How to copy certain fields so they show up twice on an invoice?

Client wants to print invoices and have customers tear off the perforated bottom third as a stub to mail back with payment. The design is easy. The problem I'm having is getting certain fields (i.e., Amount, Invoice #) to show up multiple times on the form so that I can place one above the perforation, and one below. Thoughts? Thanks in advance."

After seeing some of the answers to Kevin's issue (one person initially suggested this could not be done within the QuickBooks template design), I decided this issue was worthy of a blog posting. What follows is a link to a video giving you step-by-step instructions on how to achieve this invoice customization.

Customizing a QuickBooks Invoice Template to include a Remittance

I hope this helps Kevin and many other readers!

#ilm

Jim Merritt

 

Keyboard Shortcuts 2/18/10 4:29 PM

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Jim taught a class today. In addition to the many features of QuickBooks, he mentioned keyboard shortcuts. The two ladies that took our class today wanted to know where they could find a list of them. Here's our collection.

EDITING	SHORTCUT	ACTIVITY	SHORTCUT
Edit transaction selected in register	Ctrl + E	Copy check transaction in register	Ctrl + O
Delete character to right of insertion point	Del	Create new invoice	Ctrl + I
Delete character to left of insertion point	Backspace	Delete check, invoice, transaction, or item from list	Ctrl + D
Delete line from detail area	Ctrl + Del	Find transaction	Ctrl + F
Insert line in detail area	Ctrl + Ins	Go to register or transfer account	Ctrl + G
Cut selected characters	Ctrl + X	History of A/R or A/P transaction	Ctrl + H
Copy selected characters	Ctrl + C	Memorize transaction or report	Ctrl + M
Paste cut or copied characters	Ctrl + V	New invoice, bill, check or list item in context	Ctrl + N
Increase check or other form number by one	+ (plus key)	Open account list	Ctrl + A
Decrease check or other form number by one	– (minus key)	Open Customer Center (Customers & Jobs list)	Ctrl + J
Undo changes made in field	Ctrl + Z	Open Help for active window	F1
		Open list (for current drop-down menu)	Ctrl + L
		Open memorized transaction list	Ctrl + T
GENERAL ACTION	SHORTCUT	Open split transaction window in register	Ctrl + S
To start QuickBooks without a company file	Ctrl (while opening)	Open transaction journal	Ctrl + Y
To suppress desktop windows (at Open Company window)	Alt (while opening)	Paste copied transaction in register	Ctrl + V
Display product info about your QuickBooks version	F2	Print	Ctrl + P
Close active window	Esc or Ctrl + F4	QuickReport on transaction or list item	Ctrl + Q
Record (Save & Close, Save & New or Record)	Enter	QuickZoom on report	Enter
Record (always)	Enter	Show list	Ctrl + S
		Use list item	Ctrl + U
		Write new check	Ctrl + W
HELP WINDOW	SHORTCUT
Display Help in context	F1
Go to next option or topic	Tab	MOVING AROUND A WINDOW	SHORTCUT
Go to previous option or topic	Shift + Tab	Next field	Tab
Display selected topic	Enter	Previous field	Shift + Tab
		Beginning of current field	Home
		End of current field	End
DATES	SHORTCUT	Line below in detail area or on report	Down Arrow
Next day	+ (plus key)	Line above in detail area or on report	Up Arrow
Previous day	– (minus key)	Down one screen	Page Down
Today	T	Up one screen	Page Up
First day of the week	W	Next word in field	Ctrl + Right Arrow
Last day of the week	K	Previous word in field	Ctrl + Left Arrow
First day of the month	M	First item on list or previous month in register	Ctrl + Page Up
Last day of the month	H	Last item on list or next month in register	Ctrl + Page Down
First day of the year	Y	Close active window	Esc or Ctrl + F4
Last day of the year	R
Date calendar	Alt + Down Arrow

 

 Enjoy and happy keyboarding!

#ilm

Denise Merritt

 

Oops…Are You Sure You Want To Exit QuickBooks 1/1/10 11:14 PM

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Have you ever been using QuickBooks and you attempted to close a report or other transaction screen, but instead of clicking the "X" to close the report or transaction screen, you mistakenly click on the red "X" in the upper most right-hand corner and closed QuickBooks instead? We've all done this and it's annoying.  

Beginning in the 2009 release of QuickBooks, Intuit added a handy little feature. Intuit made it so if you did click the red "X" (on purpose or by mistake), an "Exiting QuickBooks" dialog box is displayed and you are asked, "Are you sure you want to exit QuickBooks?" You then have the choice to click, "Yes" or "No".

So, what's the problem with this? No problem at all... UNLESS, you accidently check the box which reads, "Do not display this message in the future". You see, if you check this box and then select "Yes" or "No", the next time you click on the red "X", QuickBooks will close and you are back to the pre-2009 days; unless, you know how to bring this very useful dialog box back. And that is the primary intent of this particular blog"

How do you bring this dialog box back? Why, you watch this short step-by-step video! Click HERE to Watch this Video!

Cool, huh?

#ilm

Jim Merritt

 

Changing the Percentage of SUTA Payroll Item 1/1/10 7:22 AM

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Today is January 1, 2010... Happy New Year!

QuickBooks users who use QuickBooks to do their payroll often have a daunting question this time of year. The question is, "How do I change the percentage of my SUTA payroll item?" This is a logical and important question. Assuming your rate has changed for 2010 (and many businesses SUTA rates have changed as a result of the economy and these businesses having to lay employees off), ideally you want to change this percentage before your first 2010 payroll. Therefore, now is the time to make this change.

How will you know if your rate has changed? Typically, within the November/December time frame, your Employment Security Commission (ESC) would have mailed you a letter indicating what your new rate would be. If you don't recall receiving such a letter (or perhaps you have misfiled this letter), call your ESC and request (a) your new rate, and (b) that a letter be resent via mail, email or fax.

So, how do you go about changing your rate within QuickBooks? The step-by-step instructions can be found here: Changing the Percentage of SUTA Payroll Item

After watching, if you still have questions about this topic or any other QuickBooks topic, feel free to email QuickTrainer at Contact quicktrainer.biz.

#ilm

Jim Merritt

 

CRITICAL - QuickBooks 2009 R9 Update 12/3/09 10:01 AM

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Many clients, running QuickBooks 2009 are showing concern and confusion by the new patch release known as R9. The following information from Intuit should alleviate any concern and confusion.

We are here to help...Call QuickTrainer if you have any questions: (910) 338-0488.

QuickBooks 2009 Release 9 Step-by-Step Update Guide

QuickBooks 2009 Release 9 differs from most releases. Because of the changes it makes, R9 is not backwards compatible with earlier releases of QuickBooks 2009.

Therefore you need to treat it the same way you treat an upgrade to a new year version. That is, both your program and data files will need to be updated.
More Information (with Use Case Scenarios for Accountants)

QuickBooks 2009 Release 9 requires that ALL computers accessing QuickBooks company files be updated to R9 or later, including the server.

Step-by-Step Instructions:
Frequently Asked Questions:
How do I update the QuickBooks server to R9?
How do I resolve the error message No version of QB found to update?
What if I use QuickBooks 2009 with a company file that is on the server?
Errors: "H101," "H202," "H303," and "H505"

#ilm

Denise Merritt

 

What's in the Budget - The Why and How of a QuickBooks Budget 11/12/09 4:40 PM

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Did you know you can easily create a budget for your business in QuickBooks? I promise you can! But before I outline the basics of creating and reviewing your budget in QuickBooks, I need to address the “Why” your business (and personal) finances need a budget.

 

First, the obvious reason would be to help you forecast how much revenue and expense you believe your business will incur in an upcoming period; typically the next calendar or fiscal year. The budget then allows you to measure how you expected you would do –vs. - how you actually did (Budget vs. Actual). Additionally, you can make smart, informed business decisions based on whether or not you have money in the budget to purchase that new printer or not.

 

Second, as I write this blog article, our economy is in dire straits. Unemployment is currently 10.2%. Factor in the government's own U-6 unemployment statistics (people unemployed plus those who have simply given up trying to find work, people whom are underemployed and people who want full-time work but are currently working part-time) and the true unemployment rate is a staggering 17.5%. If you want your business to succeed, and not become another statistic, then you MUST know where your money is going and you MUST have a viable plan.

 

One part of this plan needs to ensure you have a sound budget in place and that you are consistently checking this budget to measure how your plan is performing. I cannot think of a better time of year for you to create a budget for the upcoming year.

 

The above represents the “Why”. Next, let’s look at the “How".

 

To begin the budgeting process, I suggest printing out a Profit & Loss for the current year-to-date and then total columns by month so your report reflects each month and then a total. This, of course will show your actual revenue, cost of goods and expenses for the year. With this data in hand, begin thinking about the upcoming year. Here are some basic questions to ask yourself (and you need to be completely honest with yourself):

 

• What would or should you do differently to increase revenues, while decreasing expenses?

• When your annual date occurs for your leased space, does your rent increase?
  
  
• How about CAM charges?
  
  
• Insurance costs – Is your Workmen’s Comp insurance likely to increase or decrease?
  
  
• Does your business accept credit cards? Is it time to look at the merchant service rates you are paying to accept credit cards? (Shameless plug #1 – QuickTrainer can help you get started with an Intuit Merchant Service account which offers highly competitive rates, not to mention the tight integration you enjoy with QuickBooks or QuickBooks Point of Sale.)
  
  
• Paying too much for your monthly telephone bill? Perhaps it’s time to look at the various options to having an AT&T landline. At QuickTrainer, we use Voice Over Internet Protocol (VOIP) technology. Our monthly telephone bill is only $64.97 and includes a fax number and voice mail technology which delvers both faxes and voice mails as emails. It’s great!
  
  
• Can your business decrease the monies spent on accounting? It can if the QuickBooks data you provide your CPA is clean and accurate (Shameless plug #2 – QuickTrainer can help you with your data cleanup and ensure proper management going forward.)
  
  
• Will you be hiring additional employees? Don’t forget to factor in the other costs of employees (e.g., company Social Security, Medicare, FUTA and SUTA, Company Medical/Dental costs, 401-K matches).
  
  
• Are you currently outsourcing your payroll? If so, GOOD! But how much are you paying to your outsourced vendor? (Shameless plug #3 – Perhaps it’s time to look at Intuit’s Assisted Payroll. QuickTrainer can help you get started with this service and save you money.)
  
  
• If your business model currently has you traveling a good deal, you might want to seriously consider the many technology choices you have today which can keep you grounded and save you some serious bucks. All the while, providing the same excellent client service your clients have come to expect.

 

No doubt, I could go on and on with areas you should consider. But I believe you get the idea. Regardless, question with boldness.

 

With the above in hand, you are ready to create your budget within QuickBooks. For a short video tutorial on the steps involved, click this link: How to create a QuickBooks budget.

Happy budgeting!

#ilm

 

 

QuickBooks End of Year Tips 9/28/09 8:14 AM

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1. Account Reconciliations – Make sure all bank and credit card accounts are reconciled to the penny as of month-end. Business bank statements typically end on the last day of the year. Credit card statements have varying closing dates. If you find, when reconciling, that your opening balance does not match the statements opening balance, STOP and give us a call.
   
   
2. Make a Copy – Once January 2010 rolls around, and you do the December 2009 reconciliations, take the time to make a copy of the front page of each bank and credit card statement. Your CPA will want this just to verify these accounts have been properly reconciled. Also, if you have made any major capital purchases in 2009, say greater than $1K, make a copy of the sales receipt or invoice for your CPA. This does not include purchases of product for resale.
   
   
3. Want to know one of the best things you can do for yourself, your CPA and anyone whom you desire to review your books? Really pay attention to this advice! It will save you thousands of dollars during the duration of your business. Are you ready? ALWAYS, always, AlWaYs… put a brief and succinct memo in EVERY transaction you record. Check, bills, deposits, etc., should always contain a brief memo which describes, “What is this expense?”, “What is the source of this revenue?”. Do NOT cheat in this area. It will help you when you are looking at a transaction months from now. It helps your CPA (or us at QuickTrainer) when you have a memo, to understand what the purpose of the transaction expense is. It tells us if the transaction has been recorded to the proper G/L account. If not, we can correct the transaction quickly. Assuming the transaction is in the correct G/L account, we can move on with confidence. When accountants encounter transactions we don't understand, we have to ask questions. Questions cost you money. MEMO, MEMO, MEMO.
   
   
4. As you review each General Ledger (G/L) account found on your Balance Sheet and Profit & Loss statement, look for accounts which have, “ – Other” in them. This is a typical indicator that transactions have been recorded to a parent G/L account. The rule for QuickBooks is, whenever you have sub-accounts (a.k.a., child accounts), you never post ANY transaction to the parent account. The parent account serves as a means to SUM the transactions within the sub-accounts.
   
   
5. W-2/W-3 – If you have employees (personnel in which you withhold federal, state, social security and Medicare taxes on; a.k.a., payroll taxes), and you are responsible for providing them with a W-2, make sure you are prepared to do this sooner rather than later. Do you have a current Form W-4 and I-9 on file for each employee? Do you have all employees social security numbers recorded in their QuickBooks employee profile? Do you have current addresses for each employee? Are you confident your payroll items are setup properly?
   
   When printing W-2 for your employees and your records, don’t forget to include a W-3. The W-3 is a summary of all W-2’s. It gets filed along with Copy A of your W-2’s and is to be mailed to the Social Security Administration. NOTE: DO NOT FOLD OR TEAR COPY A OF YOUR W-2’S. SAME THING APPLIES TO THE W-3. When you are ready to send Copy A and the W-3, place them in an 8-1/2 x 11 envelope.
   
   There is no need to purchase your W-2’s/W-3. It is now acceptable (and has been for about 3 years now) to print these forms on plain paper. Don’t forget to sign, title and date your W-3. You need to mail (or personally hand-out) your W-2’s on or before February 1, 2010. Encourage your employees to compare their final 2009 dated paycheck to their W-2. It is important to correct any errors prior to March 1, 2010. The W-3, along with Copy A of your W-2’s need to be mailed on or before March 1, 2010.
   
   
6. 1099’s/1096 – If you have subcontractors who performed work for you in 2009, then you are obligated to provide each subcontractor a 1099 reflecting the compensation they were paid. However, this need only apply to persons or businesses in which you know they are not incorporated, or whom you have any doubt as to if they are actually incorporated.
   
   To help with this decision, and to make sure you have the proper paper work on-hand, you should have (actually, should already have) a signed Form W-9 on file. The Form W-9 is a form whereby the subcontractor provides you with their proper name, address, tax id number and indicates they are exempt from your withholding any federal taxes. If a subcontractor uses their social security number, then you know they are not incorporated. However, you can be a sole proprietor, yet still have a federal tax id. Again, if you are not certain about the legitimacy of any subcontractor being legally incorporated, err on the side of caution and send them a 1099.
   
   In QuickBooks, your subcontractors must be setup and paid as “Vendors” (NOT Employees). Additionally, you must have each subcontractors address, tax id and the box checked in QuickBooks which reads, “Vendor eligible for a 1099”. Also, you must tell QuickBooks the specific G/L accounts to look in for 1099 subcontractor vendors. The only accounts which should be considered are those which relate to “Compensation”; not reimbursed expenses.
   
   Finally, if a subcontractor was paid more $600 or more in compensation, then QuickBooks knows to produce a 1099. If a subcontractor was paid less than $600, QuickBooks will not create a 1099. This is how it should be, as $600 is the threshold.
   
   
7. With regards to #5 and #6 above, be sure to make a copy of your employees W-2’s, your W-3, your subcontractors 1099’s and your 1096. Your CPA will want a copy to verify your numbers.
   
   
8. The next several topics deal with a review of your Balance Sheet for the year. You should ensure you are looking at the Balance Sheet on an accrual basis (yes, even if you file your return on a Cash basis).
   
   
9. Accounts Receivable (A/R) – If you create invoices, and any invoices are unpaid, you will see “Accounts Receivable” on your Balance Sheet. Check this balance against the balance on an A/R Aging Report. Do they agree? If not, I will share with you, one of the most common reasons for these reports to not agree has to do with Unapplied Payments (i.e., payments received but not posted to an invoice). Call us for help with this issue.
   
   
10. Undeposited Funds – As of 12/31, there should be no ($0) undeposited funds on the Balance Sheet. If you do have undeposited funds showing, it is typically the result of deposits made, but post dated for the next year. If you have checks you have received in late December, but simply have not gone to the bank yet to deposit these funds, and do not plan on going to the bank until early January, you still need to record the deposit as of 12/31. The IRS takes the position of the fact that you had access to these funds in the current year. Just because you did not make it to the bank, does not excuse one for not recognizing the revenue in the year in which the checks were received. Of course, this would only be an issue for Cash Basis accounting.
    
    
11. Fixed Assets – If you have made purchases this year, greater than “X” (where “X” is to be determined by your CPA, or otherwise use a guideline of $250) which have a durable life, then these purchases should be found in a Fixed Asset account. This includes, most commonly, purchases such as land, building, leasehold improvements, furniture, fixtures, equipment or tools, computer hardware, computer software, office equipment and vehicles. You should NOT include product for resale (as this would be found in an Inventory Asset account or a Cost of Goods Sold account), or if you purchased a large amount of a consumable (e.g., Office Depot had a great deal on paper, so you purchased $700 worth).
    
    Finally, unless you record the depreciation of assets yourself on, say, a monthly or quarterly basis, you should not have anything posted to Fixed Asset accounts utilized to reflect depreciation.
    
    
12. Accounts Payable (A/P) – If you enter bills (and you should) and have bills which are still unpaid, you will see “Accounts Payable” on your Balance Sheet. Check this balance against the balance on an A/P Aging Report. Do they agree? If not, much like the A/R notes mentioned prior, I will share with you, one of the most common reasons for these reports to not agree has to do with Bill Payment Checks created to pay a bill but then the amount of payment on the check does not match the original bill (because it was later changed for some unknown reason – don’t do this), or the bill was deleted (again, don’t do this) for some unknown reason. Again, call us for help with this issue.
    
    
13. Credit Cards – We have already discussed the reconciling of credit card accounts in #1 above. While looking at your Balance Sheet, you should not have ANY credit card accounts reflecting a credit balance, unless you really did overpay a credit card total balance.
    
    
14. Sales Tax – This is one of the areas most often abused by people who don’t know better. The bottom line is this… whenever a taxable item is used on an invoice or sales receipt, sales tax is accrued in the Sales Tax Payment liability account. When it’s time to pay your sales tax, you should create a Sales Tax Payment check, not a regular check. Therefore, drill down into the Sales Tax Payment account. The only transactions you should find are invoices, sales receipts, credit memos, an occasional sales tax adjustment entry and sales tax payment checks. Call us for help with this if you find other transaction types.
    
    
15. Payroll Taxes – Much like sales tax above, this is another area frequently misunderstood. Paychecks create the payroll tax liability. Liability checks are used to pay these liabilities. Any other transactions amongst your payroll tax liability accounts, with the exception of an infrequent payroll liability adjustment is unacceptable and going to cause you issues with proper balances.
    
    Personally, I like to separate the various payroll liabilities into their own separate G/L account. This allows me to look at a glance to see if; (a) are the company social security and employee social security in balance with each other? (b) are the company Medicare and employee Medicare in balance with each other? (c) are there any payroll liability accounts showing a credit balance? If so, do I understand why?
    
    Finally, your CPA will want to have copies of your payroll forms filed throughout the year. These include: 941’s, 940, NC-5, NCU101.
    
    
16. Business Loans – This includes business loans from banks, car loans, mortgage loans, a line of credit, a loan from Uncle Tiger or a loan from Shareholder (think S-Corp), Member (LLC) or Owner (Sole Proprietor). Most of these loans provide you with a monthly statement reflecting interest and principal balance. While these type loans can be reconciled monthly, just like a bank or credit card account, it is most often acceptable to conduct an annual reconciliation only utilizing the last statement of the year. Assuming your prior years opening balance was correct, simply enter your year-ending principle balance, make sure the date reflects the statement date and then continue by clearing all principle payments. Any remaining difference is likely going to be the result of principle and interest payments not being recorded properly. A simple journal entry can be made to correct this difference, whereby (most often) the loan account reflecting the principle balance is credited for the difference and an interest expense account is debited. NOTE: Let me caution you to say the above is a typical or common scenario. These could be other issues causing a discrepancy. Call us for help if you have any doubts about this topic.
    
    When it comes to loans from a shareholder, member or sole proprietor, simply make sure the balance outstanding is correct. I too frequently find these loans have a credit balance. This can be where payments have been made for the repayment of a loan, but the actual original principle balance was never recorded.
    
    Finally, if you have made a personal loan of your funds to your business (which is very common), ensure you repay yourself for this loan before taking Profit Distributions or Draws. This way, you avoid any federal and state taxes being paid on these distributions or draws.
    
    
17. Equity – Within the equity section of your Balance Sheet, you will most commonly find balances for Capital Stock, Additional Paid in Capital, Distributions or Draws and Retained Earnings. These accounts seldom have transactions posted against them, with the exception of distributions or draws. Capital Stock would only see a change if something happened to the business such as a partner coming in or leaving. It would TRULY be an exception to have ANYTHING posted to Retained Earnings.
    
    
18. This concludes the Balance Sheet review. Next, we move on to a review of your Profit & Loss Statement for the year. You should ensure you are looking at the Balance Sheet on an accrual basis (again, even if you file your return on a Cash basis).
    
    
19. Income – Within the income section of your P&L, you will typically find Invoices, Sales Receipts, Credit Memos, and an occasional Payment (perhaps reflecting where a discount was given through the Receive Payment functionality). However, I realize some people bypass invoicing and sales receipts, etc. and simply record Deposits. If this is you, then you would certainly have “Deposits” recorded within your income section. Checks would be more of an exception than the rule. The exception most frequently occurs when the business writes a refund check to a customer or client. There are some other unique scenarios whereby checks might appear, but these are considered beyond the scope of this blog.
    
    
20. COGS (Cost of Goods Sold, a.k.a., Cost of Sales) – Within these accounts you will find products you resell, subcontractors who generate revenue for your business, wages of employees who generate revenue and perhaps Merchant Service Fees along with shipping, postage and materials related to shipping and postage. When reviewing the details of these numbers, if you spot transactions that don’t fall within the above, it likely means the transactions has been recorded to the wrong account and should be moved. In other words, you only wish to have those transactions which are directly associated with a direct expense relationship incurred in order to generate revenue for your business.
    
    
21. Expenses – While reviewing the details within your various expense accounts, you are simply making a determination; do each of these transactions residing in the proper G/L account. Remember #3 regarding memos? These memos are going to go along ways towards helping you make this decision. If you see a check in Office Supplies for $777.77 and the memo says, “Laura’s new laptop”, you know this check has been recorded to the wrong G/L account. It should be recorded to a Fixed Asset account (e.g., 1840 - Computer H/W). If you find a bill to Progress Energy sitting in the G/L account, “6710 – Books & Publications” you know this transaction is likely in the wrong account.
    
    
22. Last Year’s Tax Return – Another area often overlooked is ensuring your last year’s QuickBooks financials (in which a tax return has already been filed) ties to the actual tax return. This is sometimes done by your CPA. QuickTrainer provides this service for all of our bookkeeping clients. Why is this important? Your CPA cannot conduct an accurate tax return if this is not done. Again, call us if you have questions regarding this matter.
    
    I will say setting a Closing Date and a Closing Date Password in QuickBooks is a GREAT way to make sure no prior year transactions change once your business data has been submitted for a tax return. This is imperative to your success and saving yourself money.
    
    

While this blog posting certainly does not include every conceivable scenario, I have attempted to layout for you, the reader, some very common areas to review. I hope you find the above information helpful this year and in years to come.

#ilm

 

 

Make Sure You Know Which QuickBooks Version to Buy 5/5/09 12:45 PM

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QuickBooks Memorized Transactions 3/15/09 12:36 PM

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Parent - Child Accounts in QuickBooks 1/26/09 11:25 AM

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QuickBooks Year-End Preparation Tips 1/1/09 11:20 AM

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Establishing Your Opening Bank Balance 12/21/08 11:09 AM

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The IIF (Intuit Information File) Chart of Accounts 12/21/08 11:09 AM

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QuickBooks 2009 12/21/08 11:06 AM

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Backup Your QuickBooks Data…Right NOW! 12/1/08 11:02 AM

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Convert Your COA to the One Used by QuickTrainer 11/10/08 11:01 AM

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QuickBooks and Your Chart of Accounts 9/16/08 11:56 AM

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Billing and Timesheets Got You Bogged Down 8/13/08 11:55 AM

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At QuickTrainer we use a tool that’s called Time Tracker. It’s an Intuit (QuickBooks) product. It allows our employees to track their time by customer. We set Time Tracker up so it automatically sends employees a weekly email reminder to enter their time.

We can easily download submitted time into our QuickBooks file for easy invoicing, payroll processing and reporting.

This tool makes our own internal bookkeeping easier. We love it and so do our employees. Check it out!